There was persistent talk of a bearish US oil inventory report this week and it seems as though oil sold off ahead of the data, then rebounded when it
There was persistent talk of a bearish US oil inventory report this week and it seems as though oil sold off ahead of the data, then rebounded when it was confirmed. US imports surged last week and exports plunged and that should be reversed in the week ahead, helping to sustain the momentum in crude, which is up 60 cents since the EIA report.
That bounce in oil and better broad risk sentiment is weighing on USD/CAD. That pair is down 28 pips to 1.3527 as it continues to retreat from last week’s six-month high.
USDCAD daily
At the moment, the FX market is focused on the global macro picture for the loonie but I suspect it will shift towards Canadian domestic fundamentals in the coming weeks. The picture is deteriorating as more money goes towards mortgage payments and discretionary spending slides.
We won’t get any market moving Canadian data until the Sept 19 CPI report but the Toronto Star reports today that Toronto restaurants are seeing double-digit declines in traffic, citing Open Table data.
Over the first 10 days in September, the number of seated diners in the
city was down 10 per cent compared to the same period last year. The
latest figures from the online reservation service mark a continued
decline in the popularity of in-person restaurant dining, with the
volume of seated diners in Toronto now below 2022 levels for more than
three consecutive months.
There has been a similar drop in various parts of the country.
Also notably, BMO rescinded its call for a US recession this week but chief economist Doug Porter “studiously and purposely did not do the same for Canada.” He cut his 2023 GDP forecast for Canada to 1.1% from 1.6% for this year, and falling into recession in 2024.
www.forexlive.com
COMMENTS